Rooted in the analysis of risk using mathematical, statistical, and analytical techniques, actuarial science serves as the cornerstone of the insurance industry. Insurance companies would not be able to operate without having actuaries on staff!
This article delves into the evolving career landscape for actuaries in a post-pandemic world and sheds light on future job prospects for actuaries early in their careers or for those who are thinking about embarking on an actuarial career.
Many people who do not work in Finance and Insurance simply don’t know what the actuarial profession is. It’s common for actuaries to get blank looks when introducing themselves and their profession to new people! The implication of this is that actuarial work is still unheralded when compared with other professions.
10-20 years ago, many students in elite colleges and universities aspired to get into banking and consulting. During the last decade, as software companies have dominated the stock market, there has been an increased demand for software engineers, and this has become an especially desirable path for talented students. Actuarial work has gone under the radar.
The outlook for actuarial jobs is driven in large part by demand and supply.
Government statistics project a growth outlook that is much faster than the average for all occupations. The Bureau of Labor Statistics (BLS) forecasts an impressive 21% job growth for actuaries from 2021 to 2031. When compared to the average growth rate of other professions, the exceptional prospects for actuaries become even more apparent. Once qualified, actuaries become invaluable assets to any organization, with the median pay in 2021 standing at a noteworthy $106,000 according to the BLS.
Companies across the spectrum face a shortage of skilled actuaries, in large part due to the high barriers to entry for the profession. The actuarial exams and qualification process is difficult, so the supply of actuaries is constrained.
If you can get through the exams and get an Associate / Fellowship qualification, then you’re going to be highly sought after by companies who are attracted by the costly signal of an actuarial qualification. Companies rely on credentialed actuaries to perform complex tasks to a high standard.
With a wave of regulatory and accounting changes on the horizon in the U.S, actuaries will be needed more than ever. These impending alterations will require the analysis and adaptation that actuaries are qualified to provide.
The complex and ever-changing regulatory environment is unlikely to change anytime soon. Initiatives such as IFRS 17 are introducing complexity for insurance companies and this drives the need to hire experts, either on a permanent or contract basis.
With approximately 25,010 actuaries currently employed in the U.S, there's ample room for this figure to expand further. The need for their expertise is widespread and growing, fueled by a world increasingly dependent on data and the ability to navigate financial uncertainties.
We live in a digital age characterized by an immense generation of data. Insurance companies must harness and analyze this vast trove of information to maintain their competitive edge.
Actuaries, with their robust analytical skills, are poised to lead this data revolution. By utilizing these large data sets, they can aid in identifying trends, predicting risks, and optimizing profits for insurance companies.
As companies take advantage of increased computer power and the democratization of analytical tools due to better education, free training resources, and ChatGPT, there will be an increased need to get the most out of data that insurance companies already collect. Actuaries are integral to this work given their statistical and technical training offered through the actuarial curriculum.
The emergence of data science has opened up a new realm of possibilities for actuaries. While data science professionals may lack certain business skills, actuaries equipped with an understanding of data science can bridge this gap. Their expertise in business, coupled with their understanding of data, creates a perfect synergy, leading to more insightful, impactful, and efficient decision-making processes within organizations.
The actuarial profession is complex and challenging, requiring a balance of technical aptitude, business insight, and interpersonal abilities. Although the daily mathematical and statistical rigor might be less than many actuarial students anticipate, actuaries regularly tackle intricate technical problems. Their work involves developing insurance losses, building actuarial models, and monitoring change, all of which demand considerable technical knowledge.
Increasingly, actuaries with hands-on experience and proficiency in data extraction tools like SQL and SAS are in high demand. Familiarity with databases and the ability to navigate them effectively is becoming an essential skill, prompting its inclusion in actuarial syllabi.
Moreover, understanding the operational dynamics of insurance companies is crucial. Actuaries must not only devise successful business strategies but also communicate complex concepts succinctly. This combination of technical and business skills differentiates exceptional actuaries from their average counterparts.
Equally important are people skills. Aspiring actuarial leaders must excel at networking and relationship-building, within their own teams and across non-actuarial functions. Despite the significant challenges, the profession offers substantial rewards in terms of remuneration and job satisfaction.
Life insurance is one sector where actuaries continue to be the bedrock. They play an indispensable role in understanding trends, predicting life expectancies, and setting insurance premiums, all of which are crucial for profitability. Their ability to navigate the intricacies of risk management solidifies their crucial role in this sector.
Over the past few decades, there has been a marked increase in actuarial opportunities within the property and casualty insurance sector. Jobs in pricing, reserving, capital, and risk management are abundant. As society continues to safeguard itself against downside risks, actuaries' role in pricing and managing those risks will be indispensable.
The banking and consulting sectors represent emerging opportunities for actuaries. The core actuarial skills of risk management, financial modeling, and statistical analysis are highly applicable in these fields.
With evolving financial landscapes and growing uncertainties, actuaries' role in these sectors is set to become even more pronounced. www.acturhire.com contains jobs across these non-standard and emerging areas.
As we have exited the pandemic world, the job outlook for actuaries remains promising. The profession's resilience, versatility, and increasing relevance in a data-driven society ensure that actuaries will continue to be in high demand. For those who can master the balance of technical prowess, business acumen, and people skills, the field of actuarial science offers a rewarding, fulfilling, and secure career path in an ever-evolving landscape.
